This article is part of TokenTax's Cryptocurrency Tax Guide.
When your crypto gains are taxed, your cryptocurrency tax rate will be either your income tax rate or lower capital gains rates, depending on how long you held the crypto. Your holding period dictates whether you pay income tax rates or capital gains tax rates.
What are my cryptocurrency tax rates?
If you hold the crypto for a year or less before selling it, exchanging it, or spending it, then your gains are short term and taxed at your income tax rate.
If you hold the crypto for more than a year, then your are taxed the lower capital gains rate, which changes depending on your federal income tax bracket. Some other countries have similar rules.
Short term capital gains tax brackets (equal to your income tax rates)
Here are the federal income tax brackets in the United States for the 2019 tax year. These tax rates apply to short term capital gains (crypto or other capital assets held for less than 1 year). Note that this is the same as your ordinary income tax rate.
| Tax rate | Single filer | Married filing jointly | Married filing separately | Head of household |
|---|---|---|---|---|
| 10% | $0 – $9,700 | $0 – $19,400 | $0 – $9,700 | $0 – $13,850 |
| 12% | $9,701 – $39,475 | $19,401 – $78,950 | $9,701 – $39,475 | $13,851 – $52,850 |
| 22% | $39,476 – $84,200 | $78,951 – $168,400 | $39,476 – $84,200 | $52,851 – $84,200 |
| 24% | $84,201 – $160,725 | $168,401 – $321,450 | $84,201 – $160,725 | $84,201 – $160,700 |
| 32% | $160,726 – $204,100 | $321,451 – $408,200 | $160,726 – $204,100 | $160,701 – $204,100 |
| 35% | $204,101 – $510,300 | $408,201 – $612,350 | $204,101 – $306,750 | $204,101 – $510,300 |
| 37% | $510,301 and up | $612,351 and up | $306,751 and up | $510,301 and up |
Long term capital gains tax brackets
Here are the federal capital gains tax rates per income tax bracket in the United States for the 2019 tax year. These rates apply to long term capital gains (crypto or other assets held for more than 1 year).
| Tax rate | Single filer | Married filing jointly | Married filing separately | Head of household |
|---|---|---|---|---|
| 0% | $0 – $39,375 | $0 – $78,750 | $0 – $39,375 | $0 – $52,750 |
| 15% | $39,376 – $434,550 | $78,751 – $488,850 | $39,376 – $244,425 | $52,571 – $461,700 |
| 20% | $434,551 and up | $488,851 and up | $244,426 and up | $461,701 and up |
We calculate whether the crypto you are selling was held long or short term. You can also choose between different accounting methods like FIFO, LIFO, or Minimization. Our Minimization method works to defer tax lots to long term gains where possible where it produces the lowest tax liability via your tax rates.
